Asciano seals Port Botany expansion deal

Asciano
has finalised an agreement with the Sydney Ports Corp to expand its Patrick container terminal business at Port Botany after gaining access to land known as “the Knuckle".

Patrick will double its capacity and expand its quay line to four berths from three berths after signing a commercial agreement with the Ports Corp after years of negotiations. The NSW government agreed several years ago to give Patrick additional land at Port Botany as compensation for moving from its East Darling Harbour berths to make way for the Barangaroo redevelopment.

The deal comes two weeks after Asciano finalised a new enterprise agreement with the Maritime Union after more than 18 months of negotiations. The union is due to vote on the agreement on May 10.

The agreement is exactly the same as the in-principle agreement struck six months ago. “We didn’t have to give away or renegotiate anything in the end," said Asciano chief executive
John Mullen
, adding he expected a “favourable" response from port workers at Brisbane, Melbourne and Fremantle.

But getting Port Botany workers to approve it could be “a challenge", he warned, and noted Asciano was yet to win “hearts and minds". Patrick is still encountering absenteeism and misuse of sick leave at the port and has dealt with 88 long-term injuries over the past 12 months compared with just three at the Port of Brisbane, according to Mr Mullen.

Asciano’s shares closed up 4¢ to $4.79 on Thursday after it reaffirmed earnings guidance for the second half despite warning of softer growth in coal and port volumes.

Mr Mullen also foreshadowed Asciano would be “vigorously contesting" BHP Mitsubishi Alliance’s coal contracts when they come up for renewal between 2014 and 2016.